The future of media, and other nerdy stuff

Online business news in NZ

November 27, 2011

People who read business news tend to have more money and want to do things with that money, compared to people who tend to be more interested in this or this or this. For this reason, business is one of the most sought after audiences for advertisers. So let’s have a look at how NZ’s business news sites are doing.

One of the only online paywalls in New Zealand is in the business niche, at the National Business Review (NBR). Though a lot of content – 80% – sits outside the paywall. It charges about $180 a year for “premium” online content, with a half-price subscription if you stump up $475 a year for a print subscription too.

Running since mid-2009, it’s a solid freemium model, offering a large chunk of its page views outside the paywall so it can keep earning good ad revenue, while still trying to develop an online subscription base to offset any declines in its print business. The paid content is occasionally promoted on the homepage but more commonly I see it in the Paid section.

Any treatment of online business traffic has to take the NBR’s paywall into account, because a page view just isn’t worth as much to the NBR as it is to a free news site like the NZHerald.co.nz or Stuff.co.nz (full disclosure – I work for Fairfax, owner of Stuff.co.nz). A page view is much more a conversion game to the NBR than it is for Stuff. The NBR’s goal is much more to get you to subscribe, rather than simply see more page views. Plus it doesn’t need as many page views if it’s monetising them more effectively.

Alright then, how is the NBR doing since it put up its rather porous payfence? Not as stink as you might think. Hit me with some sweet sweet numbers.

(All numbers in this post are publicly reported metrics from Nielsen-NetRatings MarketIntelligence.)

This is domestic Weekly Unique Browsers for Interest.co.nz and NBR, the only two specialist business news websites in NZ.

Interest started a bit below the NBR, and ended up a bit above it, a clear win for Interest. It looks like there has been some migration of readers from one publication to the other (though you’d need to dig deeper into the data to say for sure).

The NBR’s traffic is actually pretty stagnant. It clearly lost about 5000 weekly UBs after putting in the paywall, about 15% of its traffic. It recouped those over the past two years and was especially strong mid-2011, but it’s fallen back recently to below that 30,000 starting point from mid-2009.

The latest figures I can find for the NBR’s online subscribers are 7500 from a few months after the paywall fell. I don’t expect it would have grown too much from that base, judging by the stagnant traffic to their site, and the fact that the bulk of their content is free.

Assuming most of those 7500 visit every week, we’re looking at about 1/5 to 1/4 of the NBR’s traffic being from subscribers, the rest (75%-80%) from non-subscribers.

But wait, there’s more. Here’s the standard deviation in ADUBs and standard deviation divided by the average in the past two months.

3news.co.nz/business

yahooxtra.co.nz/business

scoop.co.nz/business

interest.co.nz

St Dev in 2011

277

5,471

349

795

% St Dev

36%

25%

20%

13%

tvnz.co.nz/business

nbr.co.nz

stuff.co.nz/business

nzherald.co.nz/business

money.msn.co.nz

St Dev in 2011

811

1,180

9,270

7,598

1,239

% St Dev

19%

20%

15%

15%

29%

Standard deviation gives you a hint about how variable traffic is to a site. A high percent score indicates very variable traffic, so fewer regular reader to that section who will come every day. You want a low standard deviation because that means a greater proportion of your readers are regular readers, and can be relied on to visit every week, and can be sold to advertisers.

Now, you’d expect site with a paywall, even a limited one, to have more regular readers and fewer flybys, because it’d probably have more regular traffic. But not so NBR. It looks like it actually has fewer regular readers than its free rival, Interest.

None of this is to say the NBR site isn’t more profitable than it was pre-paywall, which is really the point. But it does seem like its paid base hasn’t grown much, and it still attracts quite a broad audience with probably quite a low conversion rate.

In fact, from the numbers above, it looks like Stuff and the NZHerald actually have quite regular audiences. You can tell from the raw numbers they do vary a lot, but because their traffic is so much bigger than all their rivals, they actually a much larger regular business audience to sell to advertisers.

How much bigger are they? Observe these domestic Average Daily UBs over the last year or so:

money.msn.co.nz

3news.co.nz/business

yahoo.co.nz/business

interest.co.nz

scoop.co.nz/business

Average Sept-Oct 2010

2,700

988

8,453

5,291

2,221

Average Sept-Oct 2011

4,170

765

21,479

6,351

1,746

Raw change

1,469

-223

13,026

1,060

-475

% change

54%

-23%

154%

20%

-21%

tvnz.co.nz/business

nbr.co.nz

stuff.co.nz/business

nzherald.co.nz/business

Average Sept-Oct 2010

3466.625

6379

48897

45038.25

Average Sept-Oct 2011

4436.625

6088.25

61170.5

53410

Raw change

970

-290.75

12273.5

8371.75

% change

28%

-5%

25%

19%

The NBR here isn’t looking so hot (unless you’re 3news). But a 5% decrease in daily UBs (weekly page views down about 10%) isn’t really that bad. I mean, it isn’t fantastic, but most media sites don’t sell all their ad inventory anyway, so the NBR is probably not bringing in much less ad revenue than it did before. More maybe, if they can target their remaining customers with better ads.

But it’s really a two-horse race between Stuff and the NZHerald, with Stuff seemingly the winner.

They started out pretty even-stevens but one year later Stuff is clearly ahead. If you look at Weekly UBs, you can see how the NZHerald and Stuff business sections used to be neck and neck, but since mid 2011 the NZHerald gets more weekly traffic only rarely.

So it’s still pretty close, though Stuff does tend to beat the Herald most weeks. But it’s a good example of how the earlier metric, looking at just the differences in averages, can mislead you. Always go back to the numbers when you can. A few hot weeks for Stuff skewed its average.

Meanwhile, Yahoo got a the biggest increase, off a low base too, but it’s still only 2.5-3 times the traffic of the big boys. Still it’s now in a solid third place, with no clear rivals, with other sites well below.

Just to give you a sense of how things have changed since 2009, here’s ADUBs since July of that year.

Two things to note:

1. Stuff’s business section is that teal coloured line. See how it jumps up at the start of 2010 and from then on starts to equal, then beat the NZHerald.

2. YahooXtra’s business section traffic was stagnant for at least 18 months, until suddenly doubling at the start of 2011. Check the metrics below too to see it’s not doing so badly at all.

Ok, let’s wrap up by looking at some engagement metrics – UB Frequency (how often people visit each week, in this case) and Average Session Duration (how long each visit last on average) – both for NZ readers only.

money.msn.co.nz

3news.co.nz/business

yahoo.co.nz/business

interest.co.nz

scoop.co.nz/business

UB Freq

1.16

1.19

1.65

2.13

1.20

ASD

102

120

78

232

105

tvnz.co.nz/business

nbr.co.nz

stuff.co.nz/business

nzherald.co.nz/business

UB Freq

1.67

2.0725

1.93625

1.95125

ASD

115.375

141.625

142.25

169.875

The NZHerald does a bit better against Stuff here, scoring about the same UB Freq but significantly higher ASD. Stuff’s Weekly UBs shot up in September-October for a few weeks. If these were fly-by readers who weren’t really interested in reading other business stories, that would lower the engagement metrics. Unfortunately that’s the downside of traffic spikes.

The goal is to get all your nice metrics going up – a site’s aim should be to settle back to a higher level of regular readers following a traffic spike, with similar or better engagement metrics.

Now hmmm, look at Yahoo. It had a whopping increase to its business traffic over the past year, but the quality of the audience isn’t anything like Stuff or the NZHerald’s. People seem to be coming in and going out again. Looks like casual traffic to me, not very attractive to advertisers.

We expect the engagement metrics at general news sites to be lower than specialist sites, and free sites to be lower than paid sites, because there are fewer casual readers.

But check the numbers: Interest.co.nz beats out the NBR in both those key engagement metrics.

That’s great news for Interest and suggests their strategy, while leading to a healthy 20% rise in ADUBs over the past 12 months, has converted a lot of its new readers to regular ones. In fact, over the past 12 months, Interest’s UB Freq has nudged up slightly, while its ASD has increased 7%. That speaks well for their content and approach.

(Stuff’s Business section’s ASD also went up about 7%, a great sign for a general news site. All the other sites listed went down).

* Got a burning question about traffic to NZ’s websites? Post yourself a comment below and myself will try to answer it.